The net figure is the question people type. It is not the question they have.
Every salary calculator gives you a take-home number. Almost nobody actually wants one, because the number on its own answers nothing. What people are really asking is one of three things: is this rise worth taking, should I put more into the pension, or why is the person doing my job in England better off than me.
All three are answered by the marginal rate, which is what the next pound costs rather than what the whole salary costs. That is why it is the headline here and the take-home figure sits underneath it.
The 62% band, which is higher than the top rate of tax
Between £100,000 and £125,140 the personal allowance is withdrawn at £1 for every £2 of income. Work through what an extra pound of salary does in that band:
- 40p of higher rate tax on the pound itself.
- 50p of personal allowance destroyed, which is then taxed at 40%, so another 20p.
- 2p of National Insurance.
62p in the pound, in a country whose top rate of tax is 45%. In Scotland that slice falls in the 45% advanced rate, so the same arithmetic gives 69.5%. Somebody on £100,000 offered a £5,000 rise keeps about £1,900 of it in England and about £1,525 in Scotland.
This is where most calculators are not merely unhelpful but wrong, because they compute the personal allowance once rather than tapering it against the income they were given. It is also the band where a pension contribution is worth the most it will ever be worth, because it buys the allowance back at the same rate it was being lost.
The Scottish 50% slice, and why nobody designed it
Income tax bands in Scotland are devolved. The National Insurance upper earnings limit is reserved to Westminster. There is no mechanism that makes the two agree, and they do not.
- Rest of the UK. Higher rate begins at £50,271. The upper earnings limit is about £50,270. They coincide, so the marginal rate steps cleanly from 28% to 42%.
- Scotland. Higher rate begins at £43,663. The upper earnings limit is still about £50,270, because Holyrood cannot move it.
So across roughly £6,600 of salary a Scottish employee pays 42% income tax and the full 8% National Insurance at the same time. Fifty per cent, on a slice where the same job in England is taxed at twenty eight. That gap is not a policy anybody chose. It is what happens when one government sets a threshold and a different government sets the one next to it.
Scotland also runs seven bands to the rest of the UK's four: starter, basic, intermediate, higher, advanced and top, plus the allowance. On a modest salary a Scottish taxpayer pays very slightly less. On a good one they pay considerably more. And Scottish rates apply to employment and pension income only, so dividends and savings interest are taxed at rest-of-UK rates even for a Scottish taxpayer, which catches out anybody on a salary and dividend split.
Three ways to pay into a pension, three different answers
The same contribution, from the same salary, produces three different take-home figures depending only on the mechanism your employer uses.
- Salary sacrifice. Comes off gross pay before anything sees it, so it saves income tax and National Insurance. It also cuts your employer's National Insurance at 15%. Employers commonly keep that saving, and commonly will add it to your pension if asked, because it costs them nothing.
- Net pay. The usual workplace scheme. Comes off pay before income tax, so it saves tax at your marginal rate. National Insurance is charged on your pay before the deduction, so it saves nothing there at all.
- Relief at source. Comes out of pay already taxed. The provider reclaims 20% and adds it to the pot, so £80 becomes £100. Anything above basic rate has to be claimed back yourself, and most people never do.
There is a quieter difference too. Student loan repayment is 9% of gross earnings above the threshold, so a net pay pension contribution does not reduce it at all. Salary sacrifice does, because it reduces the gross itself.
In the United States, the state is the answer
A federal-only take-home figure is wrong for most Americans and wrong by a lot. Yet almost every free calculator gives you one, because federal is a single table and the states are fifty-one of them. That omission is not a rounding error. It is a different answer.
Nine states take nothing from wages: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington and Wyoming. At the other end California tops out at 13.3% and Hawaii at 11%. Pick your state in the tool and it shows the gap against the best and the worst state on your exact salary, which is usually a larger number than people are expecting.
Washington is separated out rather than lumped in with Texas, because it levies 7% on capital gains above a large allowance and nothing at all on wages. For somebody on a salary it behaves as a no-tax state. For somebody selling stock it does not, and saying otherwise would be wrong for the person it matters most to.
The Additional Medicare Tax nobody withheld
The 0.9% Additional Medicare Tax applies above $200,000 filing single and $250,000 filing jointly. The catch is in how it is collected: an employer must withhold it on wages above $200,000 without regard to filing status.
So a married couple each earning $150,000 has nothing withheld, because neither salary passes $200,000. Jointly they are $50,000 over the married threshold and owe 0.9% of it. Two employers, both doing exactly the right thing, and a bill at filing that nobody saw coming. Enter both salaries and the tool works out the shortfall.
Those two thresholds are also not indexed to inflation and have not changed since the tax was introduced in 2013. Every year of wage growth pulls more people over them without any legislation being passed, which is the American version of the frozen UK thresholds above.
Where the American figures come from
Federal brackets, the standard deduction, the FICA rates and the $184,500 Social Security wage base are from irs.gov and ssa.gov for 2026. The state brackets, standard deductions and personal exemptions are from the Tax Foundation's consolidated 2026 table, which is the standard reference for this data and cites the underlying statutes.
That is a secondary source rather than fifty-one departments of revenue, and this page says so rather than implying otherwise. Local and city income taxes are not included either, and a number of cities levy their own on top.
Every figure here is 2026/27, read off gov.uk
Everything here is the 2026/27 tax year, taken from gov.uk: the income tax bands for both countries, the personal allowance and its taper, the National Insurance thresholds, and all five student loan repayment thresholds. Every one of them changes in April.
The personal allowance and the higher rate threshold have been frozen for several years running, which is worth understanding as its own effect: with the thresholds standing still and wages rising, more people move into higher bands every year without any rate being changed by anybody. That is why a rise that matches inflation can still leave you keeping a smaller share of it than last year.
Common questions
Why is my marginal tax rate 62% when the top rate is 45%?
Because between £100,000 and £125,140 the personal allowance is withdrawn at £1 for every £2 of income. So an extra £1 of salary costs you 40p of tax on the pound itself, plus 40p on the 50p of allowance it just destroyed, plus 2p of National Insurance. That is 62p in the pound. In Scotland the same slice sits in the 45% advanced rate, which makes it 69.5%. Most salary calculators get this wrong because they work the personal allowance out once instead of tapering it.
Why do I pay more tax in Scotland on the same salary?
Income tax bands are devolved to Holyrood and National Insurance is reserved to Westminster, and nobody has to make the two line up. The Scottish higher rate starts at £43,663 while the National Insurance upper earnings limit is about £50,270. So between those figures a Scottish employee pays 42% income tax and the full 8% National Insurance at once, a 50% marginal rate, where somebody doing the identical job in England pays 20% and 8%, which is 28%. It is a 22 point gap across roughly £6,600 of salary and it is nobody's policy: it is what happens when a devolved threshold and a reserved one are set apart.
How many income tax bands does Scotland have?
Seven, against four in the rest of the UK. Personal allowance, then starter at 19%, basic at 20%, intermediate at 21%, higher at 42%, advanced at 45% and top at 48%. The extra bands mean a Scottish taxpayer on a modest salary pays very slightly less than someone in England, and one on a good salary pays considerably more. Scottish rates apply to employment and pension income only: dividends and savings interest are taxed at the rest-of-UK rates even for a Scottish taxpayer.
Does a pension contribution save National Insurance?
Only if it is salary sacrifice. Sacrifice reduces your gross pay before anything sees it, so it saves income tax and National Insurance, and it saves your employer their 15% too. A net pay arrangement, which is the usual workplace scheme, comes off your pay before income tax but National Insurance is charged on your pay before that deduction, so it saves you nothing there. The same contribution from the same salary produces three different take-home figures depending on which arrangement you are in.
What is relief at source and why does it matter?
The contribution comes out of pay you have already been taxed on, and your provider reclaims 20% from HMRC and adds it to your pot, so £80 of your money becomes £100 in the pension. If you are a higher or additional rate taxpayer, the relief above 20% is not added automatically. It has to be claimed through a tax return or by telling HMRC, and a great many people never do it, which leaves a material sum unclaimed every year.
Does a pension contribution reduce my student loan repayment?
Only salary sacrifice does. Student loan repayment is 9% of gross earnings above the threshold, calculated on gross pay rather than on taxable pay, so a net pay pension contribution does not touch it. Salary sacrifice reduces the gross itself, so it reduces the repayment as well as the tax and the National Insurance. It is one of the less obvious differences between the two arrangements.
Which student loan plan am I on?
It depends on where and when you studied, and the thresholds differ by thousands, so it is worth checking rather than guessing. Plan 1 repays above £26,900, Plan 2 above £29,385, Plan 4 above £33,795, Plan 5 above £25,000, all at 9% of income over the threshold. A postgraduate loan is separate, repays 6% above £21,000, and stacks on top of whichever plan you are on. Plan 4 is the Scottish one.
Why does my take-home pay drop when I get a pay rise?
It does not, but the amount you keep of each extra pound can fall sharply as you cross a threshold, which feels the same. The steepest steps are the higher rate threshold, the point where student loan repayments start, and the personal allowance taper at £100,000. This tool shows what a rise is actually worth after everything rather than before, which is usually a good deal less than the headline number in the letter.
Which US states have no income tax?
Nine take nothing from wages: Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington and Wyoming. Washington is worth separating out, because it does levy 7% on capital gains above a large allowance. For somebody paid a salary it behaves as a no-tax state, and for somebody selling stock it does not, so calling it a no-income-tax state without qualification is not quite right.
How much difference does the state actually make?
Thousands of dollars a year on the same salary, which is why a federal-only take-home figure is not an answer. California tops out at 13.3% and Hawaii at 11%, while nine states charge nothing at all. Pick your state in the tool and it shows the gap against the best and worst states on your exact salary, which is usually a larger number than people expect.
What is the Additional Medicare Tax and why might I owe it at filing?
It is 0.9% on earnings above $200,000 filing single or $250,000 filing jointly. The catch is that your employer must withhold it on wages above $200,000 without regard to your filing status. So a married couple each earning $150,000 has nothing withheld, because neither salary passes $200,000, and jointly owes 0.9% on the $50,000 above the married threshold. Nobody has done anything wrong and there is a bill at filing. Those thresholds are also not indexed to inflation and have not moved since 2013.
Does a 401(k) contribution reduce Social Security and Medicare?
No. A traditional 401(k) or an HSA reduces income before federal and state income tax, so those figures move when you enter one. Social Security and Medicare are charged on your pay before that deduction, so they do not move at all. It is exactly the same shape as a UK net pay pension arrangement, and it catches people out for the same reason.